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Just-in-time logistics in question

Just-in-time or just-in-case inventory models are secondary with the current congestion crises

One could not help but wonder where did the projection of strong chartering pickup in late April for China came from. It would be rude to call it fiction, yet fair to label it misinformation till proven wrong. Shanghai has demonstrated its zero-COVID is strategy is nearing its end with the massive disruption.

Optimism too soon?
Tim Huxley, founder of Mandarin Shipping reportedly told CNBC recently that the container shipping industry could see a “very strong” pickup starting late April as the COVID-19 situation in China eases. Last February, some companies have warned that trade channels have become so clogged up it could be well into next year before they see business normalcy. CEOs of companies across various sectors reportedly told CNBC that any hope of a “return to normal” in 2022 is misguided, and volatility will remain a primary business challenge.

When businesses are forced to halt causing intense supply shortages, combined with a note from Japan’s Consul General to Shanghai to appeal for intervention, strong chartering pickup projection for April is eerily far-fetched. Various information outlets have gone as far as computing the statistics of vessels hanging on anchor outside the port waiting to get in, the only obvious demand is easing the rigid lockdown. This remains to be seen if Shanghai is prepared to deal with COVID-19 as an endemic like the rest of the world. The other question is if the city has the infrastructure to facilitate the transition. The shockwaves are sufficiently incriminating to deter the radical move, assuming the authorities are willing to even relook.

Having more than 400 vessels waiting to enter the port is nowhere pointing to the direction the jam is going to ease – unless there were announcements of lifting the lockdown. Even if China’s COVID-19 situation improves, resolving port congestions will not be a matter of days as much as many hoped for. Nonetheless, such would be a godsend to citizens starved of supplies, and businesses on the verge of folding. However at times like this, there is certainly no place for blind optimism.

Marine Online News Team
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